### Navigating Savings Strategies for Financial Growth and Balance

Michael can adjust his savings rate if he has a clear understanding of his financial goals.

### Balancing Savings: Transitioning from High Savings Rates to Financial Goals
* 💰 Michael has been saving **33% of his income** for years and is contemplating whether he can reduce this percentage after turning 45, especially if he is **on track with his financial goals**.
* 🤔 The key to answering his question lies in understanding his **current financial situation** and whether he has done the necessary calculations to determine the **savings rate that will help him reach his objectives**.
* 📊 If his analysis shows that he can achieve his goals by saving a lower percentage, such as **21% or 22%**, then it may be reasonable for him to reduce his savings rate to focus on other priorities like **529 plans or mortgages**.
* 🎯 It's important for him to shift his focus from simply saving to **funding specific future financial obligations** rather than just increasing his lifestyle expenses.
* 💡 The concept of "**maintaining wealth**" becomes crucial as he progresses in his financial journey, and he should engage in internal dialogue about how to "**manage his wealth responsibly**".
* 🌟 As he considers this transition, it's essential for him to remember that **money is merely a tool**, and achieving wealth should also involve **building memories and experiences with loved ones**.
* 📈 The journey to a lower savings rate can be gradual, similar to how he **increased his savings over time**, allowing him to **adjust comfortably** while still being mindful of his financial goals.
* 🤝 Ultimately, he should strive for a balance that allows him to **enjoy his wealth without regrets** and to **maximize his resources for both the present and the future**.

[Music] Michael says I've saved 33% for years, but I can't take my foot off the gas by saving under 25% after 45. If I'm on track with my number, I want to prioritize other savings like 529s and

mortgage in my 40s, but can I... what do you think? Oh, read the middle part of that question, but I... I can't. I'm saving 33% now, but I can't... but can he take the foot off the gas? So he's asking, is he able to

save less than 33%? But that's where it's a little unclear, you because like if you go to learn.moneygo.com and we have the Know Your Number course, I couldn't tell by the way he asked the question, is he saying he did the exercise or he's

done the work and he's realized that the only way he's going to reach his goal is if he keeps saving at 33%, which is because he's in catch-up mode? Or is he saying because he's just 33... just sounds so good and he loves

saving 33% that he just is choosing to... that's the part I'm a little unclear on. Maybe I... I'm going to read it again. This is how I took it. He... it said I've saved 33% for years, but can I, quote

unquote, take my foot off the gas by saving under 25% after I turn 45, if I'm on track with my number. It does that clear it up? Yeah, that definitely helps. So the answer, as any good financial advisor will tell you, is it depends. It depends on where you

are now if you've done the work you've gone to learn. money [Music] guu.vn tool and you actually did your net worth and you know exactly where you are today. Well, if you know where you need to be in the future and you know

where you are today and you've done the math to figure out what savings rate will bridge that gap and it turns out that it's not 33%, it's 21%, it's 22%, it's 18%, then by all means I would say yeah, I think it's

okay, especially if you have other goals that you're going to prioritize. If you take your foot off the pedal to pursue those other goals and I like it when it's like finite goals. Hey, there's this thing I know I want to do like saving for college, putting money to 529, that's

why we give you the 25% so that it frees you up to do those things. What you didn't say and I love this is you're not going to take your foot off the pedal just to rapidly expand lifestyle, it's more to fund future financial

obligations that you're going to have and I think that's wonderful. I don't think there's anything wrong with that at all. I I think most financial mutants cuz you get and you can tell by the way Michael asked the question, he's he's got

very comfortable saving 30 3%. I think he's going to actually have struggles taking it down to 25% and then I think he's going to have struggles taking even below that cuz he's a financial mutant and financial mutants there's something

about the comfort of feeling like you're growing, you're building, um, and he said something, he said something very clear, is that he's under 45 currently, because he says, "I want to shift this when I reach 45." And I do like the mindset here.

is because we often talk about the make wealth phase, that's really that when you get out and start making, get your first job, you start taking a little bit today for your great big beautiful tomorrow. That's a powerful concept when you just start that journey, you're on the make.

wealth, then you, you got to maintain the wealth, you, you'll get there, and you, you, you've made the wealth, now you're kind of maintaining it, um, but you will reach a point, and I, and I see this manifest in a lot of ways, is that you, you'll see

people where their family starts complaining, "Man, when we go on vacations, we do it so cheap. Or why in the world are we having me track every one of these credit card receipts when you know, do we really need to be doing that anymore?" Because it's now getting to the

point where it's, it's really impacting the relationship. I would encourage all my financial mutants, once you get to the maintain phase, meaning you know you're ahead of the curve, you're not on the curve, you're not behind on the curve, you're actually way ahead of the curve.

and you need to start having some internal dialogue, and this has been something, this is why I eventually traded in my tight wide card, is because I realized that there is maintain wealth, but there's also, "you can't take it with you" wealth. And the fact that I want you to

multiply meaning I want you to be generous I want you to give but you will start to realize man maybe the memory building maybe the the making sure that my my family um that can pay this forward in different ways with experiences and things don't sleep on

that part um because that's something we try to help people understand with mindset that's something I you can't see it off off screen right now but we actually have a new set on something we're working on that's that's pretty exciting yep that will will'll lean

really heavily on this cuz I think that there's not a lot of resources out there in social media um with traditional media for that matter where they talk about hey what happens when you've actually accomplished a lot of what you set out for now what because money is

only a tool and if you're if you set these goals like I want to have $3 million or I want to and you reach this you're kind of feel purposeless if you don't have somebody who's kind of coaching you or giving you guidance on

how to do wealth well where you don't have regrets and that's something I think we're kind of unique on and so Michael that's what I would do this like every little everything else is that moderation or slow changes can actually go a long way it's just like you didn't

get to 33% all at once you probably started out saving 5 to 10% and then you got a pay raise you went up to 15 and Beyond until eventually you woke up one day and you're like wow all those incremental decisions led to 33% savings

you can dial it back the same way if you're nervous about, as a financial mutant, transitioning from the prolific saver to just a moderate saver, um, to the point this will be great preparation for when you become a spender down the road, but just

understand the why, um, understand that that whole journey, and I know it's a unique thing out there in the world of money to talk about, you can't take it with you, um, level, but I think a lot of our fin mutants do struggle with this

and I try to be, give you the mindset so you feel like you're generous, so you don't have regrets about how you made your money or what you've created, but also so you can, you know, maximize this moment in time as well as for the future

as well as for your loved ones, that that's a skill set, uh, that I think is, is the world's hungry for, especially if you're good with your resources and you're disciplined and you're, you're building something

What Does Financial Independence REALLY Look Like?

Bring confidence to your wealth building with simplified strategies from The Money Guy. Learn how to apply financial tactics that go beyond common sense and help you reach your money goals faster. Make your assets do the heavy lifting so you can quit worrying and start living a more fulfilled life.

Subscribe today to stay up to date with our latest episodes, livestreams, and highlight videos: https://www.youtube.com/c/MoneyGuyShow?sub_confirmation=1

Are you ready to go beyond common sense when it comes to your money? Check out all the free resources The Money Guy Show provides: https://moneyguy.com/resources/



The Money Guy Show

Listener Michael saved 33% for years but wants to know if he can reduce savings to under 25% after 45.

Uncertainty about whether Michael is in catch-up mode or simply enjoys high savings.

Reference to Learn.MoneyGo.com's Know Your Number course for financial planning.

Clarification that Michael wants to reduce savings after turning 45 if he's on track.

The answer depends on current financial status and future goals.

Importance of knowing current net worth and calculating the necessary savings rate to reach goals.

Reducing savings is acceptable if it allows for other financial goals like college savings.

Prioritizing finite goals like 529s over lifestyle expansion is encouraged.

Michael is likely comfortable with high savings and might struggle reducing it.

Financial mutants find comfort in consistent growth and building wealth.

Michael's plan to shift savings after 45 aligns with the transition from 'make wealth' to 'maintain wealth' phases.

Maintaining wealth and family considerations

The 'maintain wealth' phase might lead to family conflicts regarding spending habits.

Internal dialogue is needed to balance wealth accumulation with enjoying life and generosity.

Importance of balancing wealth preservation with generosity and creating memories.

Focus on experiences and family legacy alongside financial security.

Reaching financial goals can lead to a sense of purposelessness without further guidance.

Need for coaching on managing wealth effectively and avoiding regrets.

Gradual changes are key; reducing savings gradually mirrors the process of increasing it.

Preparing for a transition to moderate saving or even spending.

Understanding the 'you can't take it with you' aspect of wealth.

Balancing generosity, maximizing the present, and planning for the future.

Developing skills for effective resource management and building a legacy.